Post Office Recurring Deposit RD

  • Post office RD is basically a monthly investment for a fixed period of 5 years with a interest rate of 7.2% per annum (compounded quarterly). On completion of the fixed  tenure of five years, RD account with Rs. 10,000 invested every month will fetch you Rs. 7,25,051.
  • After completion its tenure, account can still be continued for 5 more years on year to year basis.
  • Post Account RD helps a small investor by allowing them to invest as little as Rs.10 per month and any amount in multiples of Rs.5. There is no upper limit for the investment.
  • Joint accounts can also be opened by two adult individuals. Account can also be opened in the name of minor. Multiple accounts can also be opened.
  • RD can be transferred from one post office to another.
  • There is default fee of 5 paise for every 5 rupee in case if you miss on any monthly investment.
  • The account offers flexibility by allowing a partial withdrawal upto 50% of the balance after a year.

There is no TDS on interest from post office RD. However, income is taxable in the hands of investor as per their individual tax slab. It’s one of the best investment choices for every investor who is looking for risk-free investment avenue to save some amount every month systematically.